Hudson v. Federal Aviation Administration

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 8, 1999 Decided October 8, 1999

No. 98-1295

Paul S. Hudson and Aviation Consumer Action Project,

Petitioners

v.

Federal Aviation Administration,

Respondent

On Petition for Review of an Order of the

Federal Aviation Administration

Nicholas H. Cobbs argued the cause for petitioners. With

him on the briefs was Nicholas Gilman.

Bruce G. Forrest, Attorney, U.S. Department of Justice,

argued the cause for respondent. With him on the brief were

David W. Ogden, Acting Assistant Attorney General, Robert

S. Greenspan, Attorney, and Kenneth G. Caplan, Federal

Aviation Administration.

Sherilyn Peterson argued the cause for amicus curiae The

Boeing Company. With her on the brief was Kirstin S.

Dodge.

Before: Wald, Silberman, and Tatel, Circuit Judges.

Opinion for the Court filed by Circuit Judge Silberman.

Silberman, Circuit Judge: Petitioners claim that respon-

dent Federal Aviation Administration violated the Adminis-

trative Procedure Act by issuing a purported policy statement

without notice and comment rulemaking and that the FAA's

issuance of a "type certificate" for the Boeing 777-300 pursu-

ant to the newly adopted policy was an abuse of discretion.

We conclude that notice and comment rulemaking was not

required nor was the issuance of the type certificate illegal.

I.

The administrator of the FAA is responsible for prescribing

the minimum standards required in the interest of safety for

the design of aircraft, and may establish tests to ensure

compliance with the standards. See 49 U.S.C. s 44701 et seq.

If the administrator is satisfied that the design of an aircraft

meets these standards, the FAA issues the manufacturer a

so-called type certificate allowing it to begin production of

such aircraft.

The FAA has promulgated a rule with respect to emergen-

cy evacuation of aircraft that requires manufacturers to dem-

onstrate that:

For airplanes having a seating capacity of more than 44

passengers ... the maximum seating capacity, including

the number of crewmembers required ... can be evacu-

ated from the airplane to the ground under simulated

emergency conditions within ninety seconds. Compli-

ance with this requirement must be shown by actual

demonstration ... unless the Administrator finds that a

combination of analysis and testing will provide data

equivalent to that which would be obtained by actual

demonstration.

14 C.F.R. s 25.803(c) (emphasis added).

The regulation as originally promulgated in 1967 required

an actual demonstration when the design of an aircraft was

altered to allow a passenger capacity increase of greater than

five percent. In 1978, the regulation was amended to elimi-

nate the five-percent provision, so that it assumed its current,

discretionary, form. Then in 1989, the FAA released an

"advisory circular" that again called for demonstrations if the

five-percent benchmark was reached. See Advisory Circular

25.803-1, 55 Fed. Reg. 4,934 (Feb. 12, 1990).1 But the

circular cautioned that it "provides guidance on a means, but

not the only means, of compliance with the Federal Aviation

Regulations" concerning emergency evacuations, id. at 1, and

it stated only that "a full-scale demonstration should be

conducted when ... [t]he proposed passenger seating config-

uration is an increase of more than five percent above that

which has been previously demonstrated on an airplane ...

with an identical ... exit configuration." Id. at 4 (emphasis

added).

This case arises from the FAA's change in its position in

1998, following a reconsideration of the use of full-scale

demonstrations sparked by injuries among demonstration

participants. On March 17 of that year, the FAA issued a

new policy statement--ANM-98-2--which announced that:

The FAA has now determined that standardized method-

ologies have been developed and there are sufficient data

now available, such that a limitation on the use of analy-

sis based only on an increase in passenger capacity is no

longer necessary.... The FAA has determined that ...

where sufficient data are available, analysis is an op-

tion.... Full-scale demonstrations will still be required

when sufficient data are not available to support a combi-

nation of analysis and test [sic].

See 63 Fed. Reg. 13,095, 13,096 (March 17, 1998).

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1 An FAA advisory circular is akin to a policy statement. See

Brief of Amicus Curiae Boeing Co. at addendum 7.

Besides altering the agency's general policy by allowing

manufacturers to demonstrate compliance with the regulation

through analysis whatever the percentage increase in seating

capacity, the statement also foreshadowed the FAA's decision

to act in accordance with this policy in two pending certifica-

tion applications:

It is the FAA position that for the Boeing 777-300 and

the Airbus A330/340, there are currently sufficient evacu-

ation data available to support analysis.... In both

these cases, a wealth of full-scale evacuation data are

available to support analysis and the FAA is confident

that the use of analysis is well within the intent of the

regulation. Therefore, in accordance with the regulation,

conduct of additional full-scale evacuation demonstrations

is not required to demonstrate compliance, if a satisfacto-

ry analysis is produced.

Id.

In a rather unorthodox manner the policy statement also

invited public comment, stating that "[r]esolution of the public

comment will be considered in determining whether the policy

should be refined for future projects, and so reflected in [a

new] advisory circular." Id. at 13,095-96. The FAA received

23 responses prior to May, several of which were critical of

the FAA's decision to allow analysis in lieu of full-scale

demonstrations.

Boeing transmitted to the FAA its evacuation analysis for

the 777-300, and the FAA informed Boeing that the analysis

demonstrated compliance with 14 C.F.R. s 25.803. The FAA

consequently on May 4, 1998, issued Boeing a type certificate

for the 777-300. It simply states that "[t]his certificate ...

certifies that the type design ... meets the airworthiness

requirements of Part 25 of the Federal Aviation Regulations."

Petitioners, who represent an international group of air

travelers, airline pilots, and flight attendants, filed this peti-

tion for review. They allege that policy statement ANM-98-

2 could not be adopted by the FAA without the agency

undertaking notice and comment rulemaking, and, in any

event, issuance of the 777-300 type certificate was an abuse of

discretion because the FAA failed to explain both its underly-

ing change in policy and the reasons 777-300 type certifica-

tion complied with regulatory standards. The FAA counters

that petitioners cannot challenge the policy statement since it

was issued more than 60 days before petitioners filed their

petition, see 49 U.S.C. s 46110(a), and defends its substantive

decision to issue Boeing a type certificate for the 777-300.

II.

As noted, petitioners' main challenge is an APA procedural

one--that the FAA's policy statement was in effect a regula-

tory amendment that had to be preceded, not followed, by a

notice and comment procedure. See 5 U.S.C. ss 551(5),

553(b)-(c); National Family Planning & Reprod. Health

Ass'n, Inc. v. Sullivan, 979 F.2d 227, 240 (D.C. Cir. 1992).

The government, although tacitly admitting that the reason-

ing used in the new policy statement explains the subsequent

administrative action (which was an informal adjudication)

and is therefore a legitimate target of petitioners' attack,

contends that the procedural claim comes too late--that it

had to be raised within 60 days of the issuance of the policy

statement.

The difficulty with the government's argument inheres in

the peculiar position any petitioner is in when he or she

claims that an ostensible policy statement is in actuality a

regulation. A pure policy statement under the APA, as we

have often explained, is not an attempt to make substantive

law. See, e.g., Pacific Gas & Elec. Co. v. Federal Power

Comm'n, 506 F.2d 33, 38 (D.C. Cir. 1974). It is only sup-

posed to indicate an agency's inclination or leaning, not in any

way binding on the agency. See United States Tel. Ass'n v.

FCC, 28 F.3d 1232, 1234 (D.C. Cir. 1994). Sometimes, to be

sure, the purported policy statement on its face carries the

character of a substantive regulation, see, e.g., Better Gov't

Ass'n v. Department of State, 780 F.2d 86 (D.C. Cir. 1986),

but more often it will not and will only reveal itself as

something more than a policy statement when the agency

subsequently relies on it as if it were binding law.2 If a

petitioner could not challenge the issuance of the policy

statement at that point, because it was too late to bring the

procedural challenge, a loophole in the APA's notice and

comment requirements would be created.

Accordingly, we have often held that an early procedural

challenge to a purported policy statement is not ripe because

it is not yet demonstrable that the agency intends to treat it

as having the characteristics of a rule. See, e.g., Public

Citizen, Inc. v. Nuclear Regulatory Comm'n, 940 F.2d 679,

681-83 (D.C. Cir. 1991); Natural Resources Defense Council,

Inc. v. EPA, 859 F.2d 156, 191 (D.C. Cir. 1988).3 Typically

the substance of a true policy statement could not be contest-

ed then either because it would be regarded as not ripe until

it was reflected in subsequent agency actions (indeed, theo-

retically a pure policy statement might not even be final

agency action). See Pacific Gas & Elec., 506 F.2d at 45, 48-

49. It seems to us that as a practical matter a procedural

challenge to a policy statement, claiming it to be a de facto

rule, cannot be brought until a substantive challenge to the

policy would be ripe. Cf. Clean Air Implementation Project

v. EPA, 150 F.3d 1200, 1204-05 (D.C. Cir. 1998). In this case

the policy statement indicated that the agency was taking a

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2 We have not considered whether that analysis applies to a

subsequent informal adjudication which does not call for an adver-

sary procedure, in which case we would not see an agency refusing

to consider arguments that challenged the policy statement. It may

well be that in these circumstances a reliance on the policy state-

ment would not necessarily convert the statement into a de facto

rule. We can avoid this question here because the policy statement

and informal adjudications are so interconnected.

3 A rule of agency procedure, by contrast, will typically be ripe on

a facial challenge. See JEM Broadcasting Co., Inc. v. FCC, 22 F.3d

320 (D.C. Cir. 1994). But we think the government's alternative

argument that its statement was a procedural rule is a non-starter.

It is not a "rule," see Syncor Int'l Corp. v. Shalala, 127 F.3d 90, 94

(D.C. Cir. 1997), and it is not directed to agency procedure but

rather the substantive showing the airline manufacturer must pro-

duce. See JEM Broadcasting, 22 F.3d at 327-28.

different approach to be applied first in the upcoming Boeing

certification. As such, the policy statement not only signaled

a general shift; it discussed two specific cases that were

about to be decided. It would have been somewhat artificial

then to review the policy statement independent of those

decisions. Accordingly, we would likely have regarded peti-

tioners' APA challenge as premature if it had been brought

before the issuance of the certificate, and so we do not agree

that petitioners' subsequent challenge is too late. See id. at

1204.

Turning then to petitioners' procedural challenge, we do

not agree that the FAA was obliged to follow APA notice and

comment procedures prior to issuance of ANM-98-2. It

appears on its face to be just a policy statement. It limits

itself to situations "where sufficient data are available," states

only that "analysis in such cases may be acceptable," and

cautions that "[f]ull-scale demonstrations will still be re-

quired when sufficient data are not available to support a

combination of analysis and test [sic]." 63 Fed. Reg. at

13,096 (emphasis added). Moreover, as noted, it calls for

public comments on the policy, and indicates that there will

be a determination of whether "the policy should be refined

for future projects." Id. With respect to the 777-300, it

states that the type certificate will be approved only "if a

satisfactory analysis is produced." Id. Since the statement

does not cabin agency discretion, even as to the 777-300, it

has the characteristics of a policy statement. See Pacific Gas

& Elec., 506 F.2d at 38-39; see also Chamber of Commerce v.

Department of Labor, 174 F.3d 206, 212 (D.C. Cir. 1999). To

be sure, the government relies on the reasoning expressed in

the policy statement to support its subsequent administrative

decision, but that is not surprising because the policy state-

ment, as we noted, came only a short time before the decision

and explicitly contemplated the decision. Furthermore, al-

though the statement purported to abandon the prior practice

whereby the agency invariably required a demonstration if

the five-percent threshold was reached, nothing prevented the

agency from changing its enforcement policy again without

notice, or requiring a full demonstration for the 777-300.

Petitioners argue that notice and comment rulemaking was

nonetheless required because ANM-98-2 is actually an inter-

pretation of the governing regulation that is at variance with

the FAA's prior "interpretation" embodied in the 1989 adviso-

ry circular. They rely on Alaska Professional Hunters

Ass'n, Inc. v. FAA, 177 F.3d 1030 (D.C. Cir. 1999), and

Paralyzed Veterans of Am. v. D.C. Arena L.P., 117 F.3d 579

(D.C. Cir. 1997). In these cases, we said that "[o]nce an

agency gives its regulation an interpretation, it can only

change that interpretation as it would formally modify the

regulation itself: through the process of notice and comment

rulemaking." Paralyzed Veterans, 117 F.3d at 586. The

instant case, however, does not fit within the Paralyzed

Veterans/Alaska Professional Hunters line for the simple

reason that it does not involve an interpretation of a regula-

tion. As we stated in Syncor Int'l Corp. v. Shalala, 127 F.3d

90, 94 (D.C. Cir. 1997), "[I]nterpretative rules and policy

statements are quite different agency instruments. An agen-

cy policy statement does not seek to impose or elaborate or

interpret a legal norm. It merely represents an agency

position with respect to how it will treat--typically enforce--

the governing legal norm." Although petitioners argue that

Alaska Professional Hunters is pertinent because it, like this

case, involved a long-term agency practice which constituted

an implicit interpretation or application of the relevant regu-

lation, that is not so. In that case, a formal adjudication by

an associate agency had adopted an interpretation of the

regulation in accord with the informal practice. See Alaska

Professional Hunters, 177 F.3d at 1031.

In the instant case there is no dispute as to the regulation's

meaning. The regulation states that where the Administra-

tor finds that a combination of analysis and testing provides

data equivalent to an actual evacuation, the former may be

used in place of the latter. Whether this test is met requires

a factual determination by the FAA, and clearly, as methods

of analysis and other considerations develop over time, the

FAA's response to the test can also. In 1989 the FAA did

not believe that analysis would provide equivalent data when

seating capacity changed by over five percent, but in 1998,

spurred on by injuries to demonstration participants, it re-

viewed its policy and concluded that the situation had

changed such that analysis and testing were now sufficient.

See 63 Fed. Reg. at 13,096 ("The FAA has now determined

that standardized methodologies have been developed and

there are sufficient data now available" (emphasis added)).

This is not a different interpretation of the regulation, just an

application of the regulation to a changed situation which calls

for a different policy.

III.

Petitioners alternatively argue that the FAA was at least

obliged to give a fuller explanation for the switch of position

that led to the issuance of the certificate--one that took into

account the adverse comments submitted in response to the

policy statement. The agency was not, however, required to

seek comments on its policy statement nor its pending certifi-

cate decision. The APA includes no such requirement and we

are not at liberty to create one. See Vermont Yankee Nucle-

ar Power Corp. v. Natural Resources Defense Council, Inc.,

435 U.S. 519, 524 (1978); see also Pension Benefit Guar.

Corp. v. LTV Corp., 496 U.S. 633, 653-55 (1990). A policy

statement can be issued at any time without a comment

period and the certificate is merely an administrative action, a

so-called informal adjudication, for which an agency is only

obliged to provide an explanation adequate to give a review-

ing court a basic understanding--and not a very detailed

one--of its action. See Camp v. Pitts, 411 U.S. 138, 143

(1973). In this case the policy statement--and the explana-

tion provided in the government's brief 4 combined with Boe-

ing's submission--easily meets that standard. The agency

decided that a full-scale demonstration created too great a

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4 Since an agency engaged in informal adjudication is not obliged

to give much of an explanation before a petition for review, cf.

Pension Benefit Guar., 406 U.S. at 655-56, we tend to look to its

brief for fuller explanation of its action. See, e.g., Guardian Mov-

ing & Storage Co., Inc. v. ICC, 952 F.2d 1428, 1432-33 (D.C. Cir.

1992).

risk of injury to the demonstrators and this spurred an

examination of the use of analysis. The administrator con-

cluded that, in particular cases, testing and analysis would

provide equivalent data to an actual demonstration even if the

capacity increase were greater than five percent, and also

found that such was the case for the 777-300. That some

"commentators"--whether or not their views should be con-

sidered part of the record5--disagreed with the FAA's policy

shift is of no moment. See Marsh v. Oregon Natural Re-

sources Council, 490 U.S. 360, 378 (1989) ("When specialists

express conflicting views, an agency must have discretion to

rely on the reasonable opinions of its own qualified experts

even if, as an original matter, a court might find contrary

views more persuasive.")

Petitioners do not really claim that the FAA's position was

arbitrary and capricious, only that its failure to respond to

the comments and give a fuller explanation is illegal. For the

reasons we have given, we think petitioners are wrong. The

petition for review is denied.

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5 The parties dispute whether those comments should be regard-

ed as part of the record in the informal adjudications. We need not

decide that issue.